Bockes v. Union Mut. Cas. Co.

• Citation: 232 N.W. 156,212 Iowa 499
• Decision Date: 26 September 1930
• Docket Number: No. 39446.,39446.
• Parties: BOCKES v. UNION MUT. CASUALTY CO.
• Court: United States State Supreme Court of Iowa

212 Iowa 499

232 N.W. 156

BOCKES

v.UNION MUT. CASUALTY CO.

No. 39446.^a1

Supreme Court of Iowa.

Sept. 26, 1930.

Appeal from District Court, Grundy County; George W. Wood, Judge.

Action at law to recover damages on the alleged ground of fraud and deceit in effecting a compromise settlement under an accident insurance policy. Upon the conclusion of the plaintiff's testimony a motion by defendant for a directed verdict was made, and it was sustained by the trial court. Judgment accordingly. The plaintiff appeals.

Affirmed.

Superseding former opinion in 224 N. W. 771.

DE GRAFF, J., dissenting.Raymond N. Klass and Floyd Philbrick, both of Cedar Rapids, and Rogers & Ruppelt, of Grundy Center, for appellant.

Harold S. Thomas and J. L. Parrish, both of Des Moines, for appellee.

GRIMM, J.

On March 27, 1926, the plaintiff filed his petition at law, in Grundy county, Iowa, in two counts, alleging in substance that on December 21, 1921, the defendant and the plaintiff entered into a certain contract of insurance, in evidence of which the defendant issued its certain policy of insurance whereby it insured the plaintiff in the principal sum of $5,000, for the term of one year. The plaintiff alleged that on January 3, 1922, the plaintiff slipped and fell under a moving passenger train and, as a result of which accident, he lost both of his feet; that during the months of May or June, 1922, the president of the defendant company, by a malicious, wanton, and willful fraud, secured a release of all obligations under said policy of insurance for the sum of $1,000 payable at the rate of $100 per month, and plaintiff prays for judgment for $4,000, with interest. In the second count the plaintiff prays for $6,000 exemplary damages.

On January 20, 1927, the defendant filed an amended and substituted answer in the form of a general denial with specific exceptions. The defendant admitted the execution of the policy and alleged that the plaintiff, in procuring the same, had falsely and fraudulently stated, warranted, and represented in his application that he was engaged as an automobile salesman only; that he was insured in two other companies and that the total amount of indemnity provided in said other policies was in the total sum of $80 per month; and that the insurance applied for in the defendant company, in itself or in combination with other insurance, did not exceed his monthly income. It is alleged that these statements were untrue and fraudulently made and that the policy would not have been issued to him had he not made these false and fraudulent representations to the company.

It is also alleged that in addition to being an automobile salesman, the plaintiff is a professional wrestler. It is alleged that the contract of insurance provided, in substance, that the right to recover under any policy which might be issued on the basis of his application for insurance should be barred in the event that any one of the statements contained in said application, material either to the acceptance of the risk or the hazard assumed by the company, is false and made with the intention to deceive, and that by said agreement it was stipulated that the statements contained in said application were material both to the acceptance of the risk upon the part of the company in the issuing of the policy and of the hazard assumed thereby.

It is alleged that reports were made in reference to the accident, and thereafter a dispute arose as to the liability of the defendant company, which dispute was settled and compromised by an agreement to pay and the payment of $1,000.

It is also alleged in the amended and substituted answer that at no time did the plaintiff ever earn the sum of $280 per month, which is the total amount of indemnity provided in the three policies of accident insurance. It is alleged that the second of the three policies was secured on the 13th day of December, 1921, and the policy in question on the 14th day of December, 1921; that some time prior to the 14th of December, 1921, and continuing to said date, the plaintiff became badly involved in financial difficulties by reason of the fact that he had issued worthless checks, for which he had no money to pay, to many and various people in Grundy county; and that he had no ways or means to earn enough to pay said obligations and was not earning sufficient salary or wages to satisfy same; that he was being threatened with criminal prosecution for the issuance of said checks, and thereupon the plaintiff evolved the idea of insuring himself, with the intention to, in some way or manner, suffer an accident whereby he could secure indemnity from said insurance companies and thus retire said obligations and, in keeping with said plan and procedure, this plaintiff on the night of January 3, 1922, voluntarily exposed himself to the risks and dangers of an accident; not the one he eventually received, but said defendant alleges that the said plaintiff went behind said train at the time of said accident, with the purpose and intention of voluntarily exposing himself to an injury, fully intending, without the notice or knowledge of said insurance companies, to claim indemnity, thereby securing funds for the purpose of retiring his obligations.

We now quote some of the material parts of the contract. First, from the application:

“I hereby apply for insurance in the Union Mutual Casualty Company, Des Moines, Iowa, based upon the following representations: * * *

5. (a) What is your occupation? Auto salesman. * * *

9. Have you any insurance against accident or sickness in other companies, associations,societies or lodges (Name Company, amount and monthly indemnity). Bankers, Des Moines and Mutual Benefit, $80.00 mo. * * *

11. Does the insurance hereby applied by itself or in combination with other valid insurance on the same risk or otherwise applied for and not issued exceed your monthly wages, salary or income? No. * * *

20. Do you understand and agree that the right to recover under any policy which may be issued on the basis of this application shall be barred in the event that any one of the foregoing statements material either to the acceptance of the risk or the hazard assumed by the Company is false, and made with the intent to deceive, and do you further agree that this application shall not be binding upon the Company until accepted by the Company or by an agent duly authorized to issue policies and that the policy will not be in force until all policy fees or premiums are paid and that the maximum contingent liability of the policy holder hereunder shall be in an amount equal to the premium paid for the term for which this policy is written? Yes.

21. Do you agree to accept the policy subject to all of its provisions, conditions, and limitations and to pay the premium required on or before date due? Yes.”

The plaintiff filed a long reply in ten divisions, alleging, among other things, that a copy of the plaintiff's application for the policy was not attached to the policy when delivered to the plaintiff.

The policy provided, among other things, as follows: That it is issued “in consideration of the statements and agreements contained in the application herefor (a copy of which is endorsed hereon and made a part hereof). * * *”

It appears from the record that the plaintiff at the time of the trial, December, 1927, was 37 years of age and unmarried. He testifies that on December 21, 1921, he gave his application for the insurance in question to an acquaintance, one Brownell, then living at Eldora; that he did not read the application before signing it. He testifies that he went to the country school until he was 17; after leaving school he farmed a part of the time, working for his father and also for himself. He spent about a year in the service, returning in April, 1919, which year he farmed for himself. He states that he wrestled for money, occasionally throughout the country; that in 1921 he sold automobiles and also sold tires and accessories, on the road. When asked in reference to his purpose in taking out this particular insurance, the record shows the following:

“Q. Just what was your reason for taking out this accident policy at that time, Bert? A. General protection.

Q. Had you in mind any special trips? A. Oh I had thought maybe I would go to Dakota sometime after the holidays or nearer Spring, or South Dakota.”

At that time he was selling automobiles for a concern in Conrad, and also dealt in secondhand cars.

The plaintiff's own narrative as to how the accident happened is as follows:

“I was in Grundy Center on or about January 3, 1922. I was at the Rock Island depot about nine, nine-thirty, or ten o'clock that night in Grundy Center and was buying a ticket to Reinbeck and on that occasion and at that time I suffered some injuries. I lost both my feet. The circumstances of that injury and how it happened are that on New Year's day at dinner I had eaten something that did not agree with my stomach. I hated to start out because of the diarrhoea which had been going on for a couple of days. I was in talking with the boys. There was some man from Waterloo as I recall it, I don't remember his name, waiting for the train. I had already bought a ticket and went out,--there was quite a few in there, and I got cramps in the stomach, and felt as if I had to go somewhere for relief and lots of times these toilets are unsanitary or locked and I did not have time to examine them, and went across the railroad track of the loading platform and before I got back the train had pulled in. I came around from behind the platform. I was running fast as I thought I had to hurry and went over the first tracks or somewhere along there and I slipped and fell and that is all I remember of. I don't think I was running either to the east or to the west. I don't think I had turned very much either way. I intended to go west. I think I headed over off straight south at the time I...